Transit Tax FAQs
Frequently Asked Questions
Employers located outside of the Wilsonville transit district are subject to payroll and self-employment taxes if any employee, commission merchant, or commission employee does business in the Wilsonville transit district. Taxpayers do not pay both Wilsonville Transit Tax and TriMet Tax on the same taxable wages. If work is done in both districts then the taxable wages should be prorated and the applicable amounts paid to each district.
Yes, contributions to deferred compensation plans are subject including contributions to 401k retirement plans made at the election of the employee and matched by the employer
Only insurance-related income is exempt. Noninsurance-related self-employment activities are subject to this tax (ORS 731.840).
Not all nonprofit organizations are exempt from the Wilsonville transit tax. Only the organizations with 501(C)3 status are exempt. Nonprofit organizations will need to send in a copy of the IRS determination.
Yes, they are treated as self-employed; therefore, commissions on sales within the Wilsonville transit district boundaries are subject to the transit tax through the individual’s net earnings from self-employment.
No, Section 125 cafeteria plans are exempt from the Wilsonville transit tax.
No, churches are exempt from paying Wilsonville transit taxes.
Employees who are subject to withholding tax, are subject to Wilsonville transit tax. If an employee only works a portion of the time in the Wilsonville transit district, then only that portion is subject to the tax. Wilsonville transit taxes are determined by where the work is physically performed including job sites and home locations.
Self-employment earnings are those reported on your individual federal Schedule SE, line three, as defined in IRC € 1402. If a taxpayer has more than one business included on federal Schedule SE, only include those businesses from line three of your federal Schedule SE that have net earnings. Do not use a business with a net loss to offset a business with net earnings.
If the tax due for a quarter is less than $20 payment can be deferred until the end of the year; however, the quarterly transit tax return needs to be submitted showing the amount due with no payment; otherwise, the account will be considered delinquent and subject to penalties and/or interest. Sole proprietors can pay at year-end or make estimated quarterly tax payments.
Late payment or non-payment will result in a penalty of 10% of the tax due for accounts up to 30 days past due. An additional penalty of 15% will be assessed on accounts over 30 days past due. Fraudulent tax returns or intent to evade will result in an additional 25% penalty. Interest shall be assessed at the rate of 1.5% per month. Legal fees and costs associated with the collection of tax will be the liability of the taxpayer.
The Wilsonville Transit District boundary is the city limits of Wilsonville (including the Charbonneau District).
The excise tax is paid by the employer. The self-employment tax is paid by the self-employed person.
The SMART tax rate is 0.005 effective October 1, 2008.
The transit tax was established to finance the operating and administrative costs of the SMART (South Metro Area Regional Transit) by City Code 7.400. Service includes bus connections to Portland, Salem, Canby, and bus services throughout Wilsonville.
For more information, please contact 503-570-1518.
All employers, including nonresident employers, who are paying wages earned in the City of Wilsonville, must register and file with the City of Wilsonville Tax Department. Wages include all salaries, commissions, bonuses, fees, payment to a deferred compensation plan, or other items of value.